April 10th 2008April 10th 2008

This document reproduces the elements of a visual presentation.It is incomplete without the oral comments which accompany it.

Textile City: Textile City: An Egyptian-Italian An Egyptian-Italian Partnership For SuccessPartnership For Success

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Structure of the presentation

1. Egypt & Setcore1. Egypt & Setcore

2. Textile City in Borg El Arab2. Textile City in Borg El Arab

3. Government support and facilities3. Government support and facilities

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The land of the finest long & extra long staple cotton

Strategic geographic location Bridging Europe, Asia and Africa Proximity to European ports

Young, abundant and competitive labor force A working population of 22 m 41% of the population between 15 and 39

Egypt is a natural destination for textile investment

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One of the most competitive countries for industrial investment

480 140 180 200 150Construction/M2

0.21 0.24 0.26 N/A 0.035Natural Gas /M3

0.28 0.70 0.46 1.80 0.21 Water/M3

0.09 0.086 0.077 0.05 0.03 Electricity/KW

15 0.50 2.80 0.90 0.40 (1.15)Labor hourly wage

ITALY INDIATURKEYJORDANEGYPTCOST ITEM (in USD)

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Increasing deregulation and liberalization of economy Privatization of key sectors such as banking and infrastructure

Faster and more cost effective transactions Establishment and reform of dedicated institutions: Ministry of Investment, IDA, GAFI…. A One-Stop-Shop enabling company incorporation within 7 days

A developed banking sector with better access to finance The state divested 94% of its bank portfolio in the past 18 months International players brought competitiveness and transparency Easier distant transactions with a solid web banking infrastructure

The Egyptian government is building on these advantages

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Exporting to more than 20 countries

Introduced innovations and streamlined cotton trading business

The second largest exporter of Egyptian

cotton.

Setcore became a major player in the cotton trading business in 1995

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In 2003, Setcore entered the yarn manufacturing business

A state of the art spinning millThe latest spinning technology with 60000 spindles, gassing and twisting plant

Focus on fine count yarn spinning and providing comprehensive customer service

Three phase project30000 Spindles in 2003

Capacity was doubled in January 2007

Further expansion is planned

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Focus on customer service and quality

Closer to the Customer

Production efficiency Quality culture Supply chain

management

1. Customer Service2. The highest quality standard

1. Investment in latest technology

2. QHSE program with preventive maintenance

3. Cotton supply control

4. On going training & people motivation

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1.Why Egypt?1.Why Egypt?

2. Textile City in Borg El Arab2. Textile City in Borg El Arab

3. Government support and facilities3. Government support and facilities

Structure of the presentation

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Borg El Arab is ideal for a textile cluster

Great location Near Alexandria, the centre of cotton trade Quick access to the port and to the airport

Availability of infrastructure M²1,2million of land is dedicated for the

cluster Availability of utilities: water, electricity,

natural gas

Minor issue with the labour force No local labour force in Borg El Arab We need to offer housing to attract workers

Borg Al Arab

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The foundation of a successful cluster is in place

SETCORE1

DELTA ALBINIalba

GROUPFILMAR

Egyptian Spinning

Italian Weaving

Joint Italian, Swiss, & Egyptian dyeing)

Swiss Weaving

Italian Twisting & Mercerizing

FINISHING??

Negotiations under way with world class Finishing Company

SETCORE2

SETCORE - 3

SEIF GROUP

Pakistani Spinning

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Mediterranean Textile project is progressing and will start production in August

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Elvy Weaving will start production in November

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Structure of the presentation

1. Why Egypt1. Why Egypt

2. Textile City in Borg El Arab2. Textile City in Borg El Arab

3. Government support and facilities3. Government support and facilities

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A comprehensive joint collaboration strategy between Italy & Egypt

Financial Instruments

Investment Promotion

Technological & Industrial

Cooperation

Vocational Training & Skills

Development

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GAFI Easy access to the Free Zone activities licences An expedited company incorporation procedure

IDA

Quick land acquisition procedure Attractive land cost and payment terms

Borg El Arab City Council

Speed up building and activity licences Speed up utilities connection

Coordination and fast tracking with different government agencies to make the process easy and quick

Egypt’s Ministry of Trade and Industry provides strong support to our project

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Several partners from both sides are engaged in the strategy

Acquisition of 25% stock in a joint venture

Reduced interest rates Finance feasibility study Access to med fund

An agency of the Milan chamber of commerce

Promotion of Egyptian Italian Industrial parks

Competitiveness programs Regional cluster development

programs Industrial training courses support

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Conclusion Egypt has natural advantages for textile business Government reforms are creating a favorable business environment Setcore Spinning is an example of successful project in Borg El Arab European textile industry is facing increasing competitive pressure Textile City in Borg El Arab can provide competitive advantages to the

industry as well as benefits to Egypt With government support, Setcore and its partners are building the

foundations for a successful cluster A partnership between all players is crucial to continue build Good opportunities and assistance are offered by the both the Egyptian

and Italian authorities to make us succeed

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Thank you

Q&A Session